Cobra Effect · Decisions and strategy
BATNA
Your power in a negotiation is what you will do if you walk away.
7 cards, read aloud in 2:20, with a test and sources.
You are asking for a raise on Thursday. How much power do you have?
It is not about how well you argue. It is not about how much you deserve it. It is about what happens on Friday if they say no.
Roger Fisher and William Ury gave that Friday a name in 1981.
In their book Getting to Yes they called it your best alternative to a negotiated agreement. They shortened it to BATNA. It is the thing you will actually do instead, if this deal never happens.
Your power in any negotiation is your ability to walk out of it.
If you have another offer at the same money, you can say no and mean it. If you have nothing, then every word you say is a request. They can feel the difference from across the table, whatever you tell them.
Fisher and Ury argued against the thing most of us do instead.
Most people set a bottom line. I will not go below this number. A bottom line is fixed before you have learned anything, so it makes you deaf. It also hides a deal that is better in some way you had not thought of. What you want is a comparison, not a floor.
Which means the real work happens before the meeting.
You improve your BATNA by making the other option real. Get the second quote. Take the other interview. Price up doing it yourself. A vague alternative is worth nothing. A specific one changes the room.
Then work out what happens to them if you walk.
They have an alternative too, and it is usually worse than they let on. A landlord with an empty flat is losing rent every week the argument runs. The side with more to lose from no deal is the side that moves.
So there is one question to answer before you walk in.
What exactly will I do if they say no, and how bad is that really? Write it down as a sentence, not as a feeling. If the answer is nothing, go and build one first. You never win a negotiation you cannot leave.
Sources
- Best alternative to a negotiated agreement, Wikipedia. The idea in short: how to work out your own, how to estimate theirs, and the common mistake of counting an alternative you have not actually secured.
- Getting to Yes, Roger Fisher and William Ury, 1981. The book that named it. Short, practical, and the chapter on why a fixed bottom line hurts you is worth the price on its own.
- Negotiation, Wikipedia. The wider field the idea sits in, including the range in which a deal is possible at all, and why knowing both sides’ alternatives tells you where that range is.
Nearby ideas
- Anchoring. The first number you hear bends every estimate that follows.
- The sunk cost fallacy. Money already spent is gone, so it should not steer the next choice.
- Two-way doors. Decide reversible things fast, and save care for what you cannot undo.
- Explore and exploit. When to try something new, and when to stick with what works.
- First principles. Rebuild a problem from what must be true, not from what everyone does.
- Opportunity cost. The real price of anything is the best thing you gave up for it.
- Chesterton’s fence. Before removing a rule, find out why it was put there.
- Inversion. To find the path to success, first ask what would guarantee failure.